tv Washington Business Report ABC November 11, 2012 9:30am-10:00am EST
captioned by the national captioning institute --www.ncncicap.o.org-- >> business news from the capital region. this is "washington business report" with abc7 national correspondent rebecca cooper. >> thanks for joining us for a look at business andinance in the washington region. it is a week when the voters have a fally spoke ads are over, campaign planes haveve landed. where did we end up? pretty much where we started. president obama in the ite house,emocrats corolling the senate republicans icontrorol of t the hse. . maryland voters overwhelmingly papassed to the dream act to
a, approved gayay marriage, and m willll be building a new casino at national harbor. what does it mean for you and your wallet? we have a special half-hour withh our roundtable todayo take the post-election pl. joining us,s, >> lilive, anand in hd, this is abc 7 "n"news at noo" on your s side. " regular "washington business report" regular peter morici, economist atat the university ofof mararyland, marion blakey of the american -- induries is a trespass industries association -- aerospacee industries association. everybody thought there woululd be some clarity aft this s was all over. we will get to theiscal cliff later. let's see go with clarity. do you see any a after tuesday night? >> the fog of uncertainty iss yet
to left. it was the status qu election, and not everyone is pivotiting to the problems of the debt and deficit. this certaly did not s spend enoughgh time e on it during the election. >> peter, the voters have spoken to what did th say? > not a line. president obama clearly has a mandate for his policies. >> do you see it as a mandate? >> i'd like to finish. but the deficit cutters and spending cutters held on. you have two competing mandates. will they got their rhetoric or will they sit dodown a get to work -- drop thehetoric, or will they sit down and get to work? >> bruce d depuyt, a lot of peoplple were hopoping there would be clarity after this. i was saying to peoeople on the flightack from boston -- i was at romney headquarters -- it wawas too close.e. yes, it was and not look cor
-- electctro clege landslide but there were a lot o of republicans saying that if o only we had done more of this, more of that. >> sometimes more getsou less. voters have very -- there was a significant contract offer to the amerirican electote, and they did choose. me peoeople mimight missing the fact thavoters did make a very fufundamental choice. what we're seeing is a lot of posturing could i t think we will get a deal. i think ththat wall street will insist upon a deal. we will get to deal when we get a few people into a room d posturing recedes. >> marion, you heard president obama say it before, electctions have consequences. i heard republicanss say yes they have consequences, i was nt back.
you see the republicans saying we have to shift, or do you see more republicans saying that we needed to make a stronger course towardrds our direction? >> more willay that we need to make a stronger course toward a bipartisan compromise. absolulutism dozen w when the day all the money. that is what sequestration is -- sbsolutism doesn't win the day ultimately. that is what sequestration is. >> megyn kelly said this to karl rove -- do you believe that people are headed in that direction? >> when we have the drama of trying t to avo the problems of the debtbt ceiling everyone looking down theoomingng chm, that put a very bad
taste and in t public's mouth. anand common sense -- >> boy, are u in the wrong town. >> comommon sense says that you do something at this point. >> rub is going to be inn revenues. you see the laying down of markers by the leadeders on the hell and the president- on the hill and the president. the question tharemas openen to how tngs unfold is on rates. will congrs receipt on -- recede on rates or will the president? we can close t the g ifeoplee at the top pay more. >> i want to save that for r the next segnt. what is next f for thehe replican party and d demoatic party peter morici, you got a shout out ththis week in n "the washington post." you are often cited as an economic genius.
they cited seval pe ple who were wrong in their prognostications and you went out on a limb and said that mitt romney will nd and garner ough election votes. he wilill win more than 50% of the popular vote and garner att least 270 electoral votes. what went wrorong, and your forecast? >> in order for romney t to win, you had to have a higher percentage of 73 be white votes with the turnout, and the turnout and the ground in thatt mr. obama had in place w superlative.e. he got out his base, and as a conseqequence, r romney lost b by very small amounts in virginia and florida. what i missed, what rove wou admit that he missed, is that romney would have e lost no matter whatat. even if he had won the popular
te he would have lt ohioio and at the e election. >> i covered both sides s with their ground game. on tuesday night, mitt romney's people were looking at the burgeoning n numbers and were very helpful. they were calling me all night saying that "we are doing greaeat in coal country, significantly multiplied since when john mccain ran for office." there were other place parts of the statehere there was betttter turnout for romney did they were very helpful. but ththey also thought that the turnout would not be as strtrong for young voters suppororting obama, bck voters supporting a,. -- obama. in the e, when fairfax county and alexandria votes cacame in, that is where theyere wrong. >> a lot of common n interests between the romney campaign in virginia and george allen campaign in rginia on the issue you cite, what republicans call the w on coal.
no doubt that this territory f for the red team. but young people and oththers, who are cruciaial and central to the obama universe, anand tim kaine benefited fromom this as well -- they came out in numbers. they were both wo -- they were mototivated in numberss to comeut. >> mr. obama medical forcece early and the camign, that he could forsake coal and oil interests by a winning those w keep least as well as those he annoyed. -- who he pleased was tse he annoyed. it would be strong base of support for "clean ergy" a as a concepept. what you saw in virginia was why obama 1 nationally.
>> one saidid a prayer with h employees.s. i thought was verery interesting whenen i iervied george allen -- iaid to him that when you lose the race it was more than justst the macac mome. he s said, "i i learned thhard way, wneeded moree of a statewide grass-roots campaign." clearly y he w outdone by the democrats. obamaaad 100-somodd fifield offices ohio compared to romney's 30. joe biden and barack obama vivisited -- at least one them visisited ohihio once every three weeks since the last election. those kindnds of things can make a difference. much more in our roundtablble. we w will talk abouthether we fall off a cliliff or not. when we come back, the nation may be in debt but is your housusehold? we will take a timeout to talk
>> the number of the week, 1.6 is the year year drop in the consumerndex and the baltimore-shington metropolitan area. unlike congress and e u.s. government, consumers have remained cautious about taking on new debt. equifax says that mortgage debt is down by 3.4% nationally the compmpany sees coconsumers buying more cars. otter debt went up.
stay wstith us. we want to get back to our roundtablele. >> good deeds don't often make a compelling headlines. i wod like to think that our good deeds are more common and less exceptional and less worthy than our shortcomings. yet the many good deeds performed by people in business and government deserve recognition. i returned from a remarkable golf tournamenent supporti a nonprofit which rewards education scholarships to the families of our soldiers d. i grew att -- microtech has an inresting effort promoting men's health. let's not forget the government industry groups, such as the bethesda chapter of a company ththat raised $800,000 for the children's wing at nih.
the next time you read about an egregious act by someonen th government, , there e are far m more instanances that mayay not this year, america's privately-owned frfreight raroads plan to spend $23 billion on their network. that's like building 4 nat's stadiums, 5 wilson bridges, and 8 dc convention centers...all in onene year. and not a penny of it comes from taxpayers.
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hurry in today. the smoked sausa breakfast sandwich is only at dunkin' donuts for a limited .me. grab one today. this year, america's privately-owned freight railroads plan to spend $23 billion on their network. that's like launching 4 mars rovers, 10 gps satellites, and 20 space shuttles ...all in one year. and not a penny of it comes from taxpayers. >> we like to have aull half hour with the roundtable. peter morici sti talking about everything that is going on even during the breakak. we hate r you to miss that. you have written a great deal about the so-called fiscal cliff,nd one of ththe things at you wrote -- "of family, to recover remains dependent on huge federal
deficits which are three times the last bush adminiration deficit in 2008." you saying that the recovery, what little of it we have had has happened because the spendiding has kept on going and tax cuts have kept on going . >> how can wreduce the deficit when we are s so dependent on it to keep the economy going? we of not dealt with the structural problems that causused a great recessssion -- problems withth the banks the loss of american competitiveveness, the huge trade visit, the growing oil spill, which remains very rge. in order to t the deficit long-term, there are two sets of reaealizations that are nececessary. taxing h high income people alone won't do it, because health care costs are rising and the population is aging. in order to m make ficit progress, you have to raisise the retirement age and take on the price of health care, the way theermans and the dutch havave, something that is anathema to
both parties. at the same time, if you are going to reduce the deficit, you have to fige out a way to sell americanroducts to someonene other than the government. the answer to that is going to be becoming energy-independent. the problem with that is when the president talks about it, he means something very different than what republicans say when ththey talk about it. and dealing with china, which the president does not want to do. the republicansiew it as protectionist trade you h have assetsts of mplex probms which must be resolved, i d don't see much hope for that in t the next rounund. we will get a band-aid, the higher taxes that you despererately wt, -- -- yes - [laughte >> he likes to label. marion blakey, you know this town as much as anyone. none of these thingngs are right to happen anytime soon -- going
to happen anytime soon. can i to say what my pet peeve is? >> pet pve of the ek. >> p pet peevef the e year, , mayb bruceepuyt. the cbcbo sayiying that if the deal is not reachched to oveome the deficit, real gdp would drop 0.5% in 2013, unemployment would ju to 9%. that is assuminthat no ta rates go up and d no spending g cuts -- >>isten to that -- >> way, i want to finisish myy point. thfiscal cliff means that tax, exexpiring and s spending cuts going into effect, and we will get that en if ther is agreement t has toto include some of ose ththings. >> if adoptethe agrgreeme, we will los$6 billion of purchasi power -- if we don't get the agreement, we will lose $6 billion of purchasing power
-- >> that assumes that the agreement has no cos >> n if we keep doing what we are e doin -- if wfall off the clf, if there i is no deal, taxes go up by $150 billion $130 billion, anand weave a $ $500 bibillion reduction in spending -- >> but a any kind of compromise ul incde a reduction in spding -- >> that is why i i thinknk there is a re risk of receson because e of wt th are doing >> t the right kind of reduction in spending. we need to a addre the fundamentals. a lot of people don't realize that t the part of t budget that is d discretiona -- defefenseby the way - -- is 35%. you still don't get to the kind of spending that we have to do,o, and that goes to e entitlement programs. >>et me askou this hestly -- a are the various interests now
ying to defend their individual programs rather than trying to focus onon just what would stop the fiscal cliff entirely? it a game of let my protec -- let me protect my program? >> no, it really isn't. therere mu be brough solutn, bipartan, and it passed to include tax reform and entitlement reform. defense on the table, for added 7 billion of cuts are already going -- $487 billionf cutsts are already y going into o this. >> one of thehings that business leaders talk about al the time is s the cost of uncertainty. we are in an environment of maximal uncertainty. you will see significant pressure from wall street in t the business community for a deal derstanding that there will be
sharared pain and we wilill he skin in the game. yes, there will be protectedo -- will be attempts toto protect the status quo. there has to be pu and pull, on all sid, and you have less uncertainty going forward -- >> "the wall street journal" had a good headline -- "c.l.'s to washington: stop already." mcconnell said "i didot g elected to raise taxeses." u know that eric cantor will try to hold dowown on the house side on raising taxes. but you heheard jojohn boehneray "i am the most reasonable guy in all of washington." we will see what happens within ncy pelosi. if she decides to run agait the leaders, she will be one of the westover people in the room. it could be an interesting race between steny hoyoyer, whwho may be
more willing to compromise with republicans, and chris van hollen, who o may neneed nancy pelosi's backing to beat at steny hoyer for the job. >> there is no question that if you take the rhetoric at face value, there is no deal possible. i think the american pple are hong there is give-and-take on both sides but it is going to be tough bececause of the obama rhetoric during the campaign those at the totop end of the ectrum paying a little bit more, the republican line of "we are willing to have a discussion but it cannot inlve rates." the gap has got to be bridged -- leaderers haveve to havave a al they can sell to their rank and file. >> the real problem here is that even if you raise taxes on high- income individuals by $100 billion to $15billion and to cut spending by an equal amount, so you me john boehner and the president happppy, tt's still just kicks t the can because it
does not address the problem of entitlements growing to do that you will have to make changes ithis town, programs that neither republicansns nor mocrats want to mamake -- hold on - and you have to raise middle-class taxes to. >> maryland, question 7 ququestion 6, e dream act -- we willll skip past th. i want to ask aboutut virginia. this cld impact thgovernrnor's race. if virginia -- a democrat wins the presidency, they tend to go the other r party. >> we have seen such wide swings that i it isard to predict. >> which is why i wanted to keep watching. that is it for our roundtable. we will be back with closing notes when we switched to fios,
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>> thanks for joining us. ts to talk about this week. they are still talking during the break. before we go, you always have options on how to o connecect with "washington business report.t." on twitter @washbiz, search for usus on facebook, and you can find us streaeaming on wjla.com. thanks for joining as.
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